Rockeagle Ltd v Alsop Wilkinson; CA 1991

References: [1992] Ch 47, [1991] 4 All ER 659 The position of a stakeholder and the two potential claimants to a stake is the subject of a tripartite contract. The relationship between the stakeholder and the two potential claimants is contractual, not fiduciary. The money is not trust money. The stakeholder is not a trustee or agent; he is a principal who owes contractual obligations to the potential claimants to the stake. At common law, before settlement, if both parties agree as to the way in which the deposit should be paid or otherwise transferred, the stakeholder is obliged to follow that requirement.Farquharson LJ said: ‘It is clear from the authorities, and in particular Potters v Loppert [1973] Ch. 399, that the duties and authority of a stakeholder lie in contract or quasi-contract and not as trustee’. This case cites:

Cited – Potters v Loppert ChD ([1973] Ch 399, [1973] 1 All ER 658) The court was asked as to the liability of an estate agent to account for interest earned upon a pre-contract deposit paid to him expressly as a stakeholder. No contract was made. Held: A stakeholder is not a trustee or agent; he is a . .